Cipla Targets U.S. With Glaxo’s Advair, Anti-AIDS Drugs

By Ketaki Gokhale

Cipla Ltd. (CIPLA) shot to prominence a decade ago by selling AIDS drugs for $1 a day in Africa. Now the Indian generics maker is seeking a bigger slice of the U.S. market with cheaper medicines for asthma and HIV.
Cipla’s top target is a version of GlaxoSmithKline Plc (GSK)’s asthma treatment Advair. It plans to submit an application to the U.S. Food and Drug Administration this year for an aerosol version, Chairman Yusuf Hamied said in an interview. While the U.S. patent on the drug expired in 2010, Glaxo still has protections on the inhalers used to deliver it, and the U.S. is making generic drug makers prove that their devices are as good.
“Generic Advair -- if Cipla gets it through -- it will change the face of Cipla,” Hamied said, without specifying when he expects to start selling his
version in the U.S. or if his company could be the first to do so.
Hamied’s goal is to make Cipla a significant player in the U.S. by 2020, with 20 percent of sales coming from there, compared with about 9 percent now. In the HIV market, he plans to bring cheaper copies of top-selling Gilead Sciences Inc. (GILD) medicines to the U.S. Mumbai-based Cipla had global sales of about $1.6 billion last fiscal year.

Photographer: Adeel Halim/Bloomberg

Yusuf Hamied, chairman of Cipla Ltd.

Cipla gained as much as 3.5 percent in Mumbai trading today.

Top Product

Advair was the world’s fourth best-selling medicine last year and Glaxo’s top product, bringing in a total $8.25 billion in 2013 from powdered and aerosol versions. As it makes cheaper copies of the Glaxo drugs, Cipla faces competitors such as Mylan Inc. (MYL)
Mylan, based in Canonsburg, Pennsylvania, aims to file an application for generic Advair to the FDA in the third quarter of 2015 and start selling it in the U.S. market in 2016, President Rajiv Malik said on an Aug. 7 call with analysts. Malik said the company will be the first to market in the U.S.
The FDA last year revised guidelines on the asthma medicine, saying long, expensive human tests aren’t required to show copies of the drug work the same. Glaxo’s brand-name version is projected to have sales of 3.53 billion pounds ($5.9 billion) in 2016, data compiled by Bloomberg show, as competing products gain traction and as Glaxo introduces other treatments.
“We are confident of maintaining our leadership position in this field well into the next decade,” said Glaxo in an e-mailed response to questions. New respiratory products such as Breo, Anoro and Incruse, and products still in the pipeline will generate new sales growth, Glaxo said.
Cipla has developed expertise in the aerosol version of Advair, Hamied said. The spray version was developed by Glaxo to improve delivery into the lungs for people who can’t use dry powder inhalers.

European Market

Cipla has approvals for copies of the aerosol version in 10 countries in Europe, including Germany and Sweden, according to Hamied. The company has submitted an application in the U.K. and hopes to have an approval from the U.K. regulator by the end of the year, he said. Country-by-country launches in Europe will happen “well before” the end of this year, Hamied said.
“Advair is the biggest opportunity in inhalation products for Indian companies, and the nearest one,” said Nimish Mehta, director of Research Delta Advisors. “This is going to be one of the major growth drivers for Cipla,” which will be first to market in Europe with substitutable generic Advair, Mehta said.
A copy of the powder version of Advair made by Sandoz -- which is not substitutable with the original Glaxo product -- is already available in Europe.

HIV Opportunity

Even without patent protection on the drug itself, Glaxo has protections on the inhalers that dispense the drug: until 2016 for the “Diskus” device that dispenses the powder version of the drug, and 2025 on the inhaler that dispenses the aerosol version. The FDA’s last guidance from September laid out the characteristics that an inhaler should have, including a similar size and shape to Diskus, suggesting some generic devices may qualify.
In the U.S. HIV market, Cipla’s plan is to make more drugs available at lower prices. Gilead’s drug Atripla sells for about $24,000 a year in the U.S., while its pill Truvada goes for about $13,000, Hamied estimates. The generic copies Cipla sells in South Africa cost $98 and $72 per year respectively, and can be made available in the U.S. after patents expire between 2017 and 2021, Hamied said.
The copies already have tentative approval from the FDA through the PEPFAR, or the President’s Emergency Plan for AIDS Relief program, the U.S. government initiative that provides AIDS drugs in Africa.

Patent Fights

Responding to questions on the status of its patents, Gilead spokesman Nick Francis said the U.S. company settled infringement lawsuits against Cipla over the drugs Emtriva and Viread -- made of ingredients also used in Atripla and Truvada. The terms of the settlement weren’t disclosed, Francis said, without providing more details.
Cipla is planning its first-ever manufacturing plant in the U.S. The new facility might be focused on making HIV medicines, Hamied said.
“We have the expertise, but apart from us, there are 10 other Indian companies doing the products,” he said of the HIV drugs. “So, with the tooth and nail competition, believe me, prices in the U.S. will be like the South African prices.”